Once upon a time, the fossil record of human evolution could be interpreted as a single lineage descending from the ancestor we shared with African great apes (chimpanzees and gorillas). But many new finds have transformed the "evolutionary tree" of Hominidae into a densely branching bush. As many as 20 hominid species are recognised, and recent finds suggest that we diverged from apes at least 7m years ago.

Unexpected findings have emerged, introducing greater complexity into the hominid fossil record. New findings can even be expected outside Africa. Just a few years ago, reliable dating of fossil Homo to 1.7m years in Georgia, coupled with redating of fossil deposits in south-east Asia to a comparable age, almost doubled the known date by which hominids had migrated out of Africa.

This perhaps explains the rapturous response to the Nature paper published last October by Peter Brown and colleagues, reporting a population of diminutive hominids inhabiting the Indonesian island of Flores 38,000 to 18,000 years ago. The popular press soon named them "hobbits".

A companion Nature paper by Michael Morwood and colleagues reported on stone tools. Dwarf elephants (genus Stegodon) were also present, and it was suggested that a similar process of body size reduction had also led to local dwarfing of late-surviving Homo erectus. Nevertheless, the "hobbits" were considered distinctive enough to be a separate species: Homo floresiensis.

Time for a reality check: the tiny brain size of Homo floresiensis (indicated by a cranial capacity of 380 cubic centimetres) is utterly incongruous. The cranial capacity reported for the single known skull is simply far too small to be explained by dwarfing of Homo erectus. The value is very close to the average for chimpanzees (360cc) and smaller than in any fossil hominid less than 3m years old. It is well established that reduction in body size within any mammal species incurs only limited reduction in brain size. The body size of Homo erectus would have to be reduced by 97% (from 60kg to 2kg) to cut cranial capacity to 380cc. Alternative explanations, such as divergence of Homo floresiensis from other hominids more than 2m years ago when brain size was smaller than in any other known Homo species, are equally implausible.

The tiny brain of "Homo floresiensis" contrasts with the sophisticated stone tools found at the site. Many are flakes, including bladelets, struck from prepared cores. This advanced technique, typical of relatively recent Homo sapiens populations, is unknown for Homo erectus. It is inconceivable that a tiny-brained offshoot from Homo erectus or some earlier hominid lineage would have independently developed such a big technological breakthrough. Remains of Homo floresiensis are also reportedly associated with charred bones that "hint at the use of fire and cooking" - a surprisingly modern cultural context.

An alternative explanation is that the Flores hominid skull is that of a modern human with an abnormality. This individual was undeniably "microcephalic", as the braincase was unusually small, and it was possibly a nanocephalic dwarf (midget) with a matching small body. In their original paper, Brown and colleagues dismissed this possibility out of hand.

By contrast, Teuku Jacob - the doyen of Indonesian palaeontology - examined the Flores specimen and concluded that it is a modern human microcephalic dwarf.

This interpretation is seemingly contradicted by a comparison of internal braincase contours just published by Falk, Moorwood, Brown and others in Science Express. The Flores hominid was compared with African apes, fossil hominids and modern humans, including a "European microcephalic". Overall, the brain shape of Homo floresiensis reportedly resembles that of Homo erectus but also shares certain advanced features with Homo sapiens. Although it least resembles that of the single microcephalic in the comparison, no details are provided of the medical history of that individual. The dimensions indicate that the microcephalic's cranial capacity was about 210cc, which cannot be regarded as representative of human nanocephalic dwarfism.

The choice between a new hominid species and an early human pathology remains open. If this controversy spurs further research, especially increased fossil-hunting in Indonesia, it will have served a purpose. If only we could find a fossilised ring-bearing finger ...

· Bob Martin is the author of Primate Origins (Princeton UP) and has held professorships in anthropology at UCL and the University of Zurich